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Forum “Greening ICT Supply Chain”

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1 Forum “Greening ICT Supply Chain”
Life Cycle Management in the value chains - UNEP's activities worldwide Sonia Valdivia Oficial de Programa UNEP DTIE Tom Swarr Five Winds International

2 Overview Introduction
Life Cycle Management & the Capability maturity model Next steps

3 LCT and the 3 pillars of the sustainability
Sustainable development “meets the needs of the present … We are here at Rio+20 discussing about how Sustainable development can improve the quality of life for every individual without expending the earth’s resources beyond its capacity. This cannot be done by one person only. The journey towards sustainable development requires that businesses, governments and individuals take action, by changing consumption and production behaviors, setting policies and improving the quality of life. As a result, businesses have to find innovative ways to be profitable and at the same time improve the environmental and social performance of products. Resources: A UNEP Guide to Life Cycle Management, UNITED NATIONS PUBLICATION, DTI/0889/PA, ISBN: …without compromising the ability of future generations to meet their own needs.”

4 Life Cycle Management Nevertheless, still more is needed, and in order to raise awareness of the benefits and ways to include in the day by day activities of an organization, the LC Initiative published Life Cycle Management. UNEP and SETAC (2012)

5 Why Life Cycle Approaches?
Adopting a life cycle approach demands data, methods, users and management, all of them aiming sustainability as shown in the adaptation of this idea in Fava's publication. It is clear that taking into account the whole life cycle demands much more than traditional management. One does need more information along the life cycle and we all know that even the info in an organization is already high. Nevertheless that is what brings the organization to more sustainable products. Adapted from Fava (2011)

6 Life cycle challenges and opportunities
80% of current management effort covers only 20% of the available opportunities for value creation Environmental and social impacts high Upstream Opportunities: Building up better alliances with suppliers , access to limited resources, stability of supply, etc. Downstream Opportunities: Customer satisfaction and loyalty, improved brand image, etc. Opportunities for value creation through environmental and social responsibility low Disposal Consumption Retail Manufacturing/ Processing Transportation Production Product Chain Source: Adapted from WWF-UK 2003

7 Economic benefits of applying LCA based approaches Figures based on real cases
20 Xerox saved 400M $ in 2009 by implementing D4E (=LCA) Some of Wall-Mart suppliers saved up to 71% of their annual energy bill by implementing the Wall-Mart footprint approach Through implementation of LCA results, detergents producers in US saved over 1.8 Mm3 of water, t of plastics, t of cardboard, and several millions of dollars in transportation costs over 3 years Every 1$ spent on sustainability saves 2$ in operating costs. Bloomberg’s sustainability efforts have resulted in over 25M$ in net savings in 2008. By implementing Life Cycle Management principles, 3M has saved over 1.2 billion $ over 30 years Philips uses LCA as an eco-innovation tool to develop their “green” products. From 2007 to 2010 they increased their sales of green products of about 50% (from 20 to 38% of total sales) Most of the top 500 companies listed in Forbes are using LC based tools ... Imola Bedő

8 Metrics / chaotic / qualified / efficient / effective /adaptive
No metrics Binary , Yes – no Legal compliance Procedures in place Process, Inputs/outputs Efficiency, prevention Waste minimized Life cycle perspective, Integrated across Value chain New markets/products Sustainability, Resilience Focus on capital Preservation & long- Term prosperity / qualified / efficient / effective /adaptive

9 Alignment with ISO 9000 and 14000 - Management system approach - Continual improvement - Monitoring plan - Adapted to current level of organizational capability - Multiple P-D-L-A Cycles - Gradual expansion system boundaries for added capability and enhanced business value

10 ACTION LEARNING Scope Business case Socio- technical system
Enhanced well being- sustainable prosperity Value chain Stronger balance sheet- long- term competitive advantage Enterprise Top line growth - Innovative products, new markets Facility Bottom line gains- efficiency, cost reduction Unit operation Risk avoidance- Legal compliance

11 Qualified: implement basic procedures to protect people and the environment
Management commitment End-of-pipe measurements: -Waste -Air emissions -Water discharges Identify key measurement Gaps for next cycle? -Corrective actions -Working rules -Employee training Legal compliance Risk avoidance Starting with an end-of pipe approach Teaching on: -Compliance -Basic procedures (e.g. planning) Sources of learning: -Inspection reports -Root-cause Analysis?

12 Efficient: upgrade procedures
Management commitment Facility approach (Input/output): -impacts -energy consumption -water balance -toxic chemicals use Identify performance gaps that require redesign/innovation? -Management &monitoring plan -Employee development plan -Report performance to public Process efficiency Eliminated waste ISO and ISO 9000 approaches Risk assessment to set priorities: -Risk assessment -Pollution prevention -Waste minimization Sources of learning: - Management system results -Define KPIs and targets -Assess training & development needs

13 Effective: Life cycle thinking in progress
Management commitment Identify key external barriers For enhanced well being Value chain perspective: -hotspots and impacts -scopes 1,2&3 GHG -water footprint Reporting involving Stakeholders and the Value chain: Ecolabels, EPDs, Green marketing & Stakeholder Engagement plan New markets Innovative products LCA/LCM training: -Ecodesign/design for environment Annual program review: -Resources use reduction - Extend KPIs to value Chain Trend analysis Stakeholder feedback

14 Adaptive: becoming a mean towards SCP
Management commitment Product system: -socio-economic profile -sustainability index for production systems -market barriers - Stakeholder assessment Co-create new markets for Enhanced well-being -Sustainability management System -Public reporting (transparency) Focus on capital Preservation & long- Term prosperity Action learning: -System innovation -Public private Partnership to overcome market barriers Sources of information: -Stakeholder review performance -Baseline sustainability assessment

15 Adaptive: becoming a mean towards SCP

16 UNEP/SETAC: Next Steps
Conduct Phase 2 pilot to validate with quantified benefits Refine self- assessment protocol & assess integration with MNC supply mgmt Refine training materials and deploy to internal (MNC) and external (local network) trainers Confirm ability of SME suppliers to plan their own improvement programs & balance local/ global sustainability objectives


18 Merci! Contact E-mail:

19 Value chain (ISO 26000) 20 The entire sequence of activities or parties that provide or receive value in the form of products or services (ISO 26000)

20 Benefits of Capability Approach
Global companies Extend supply chain programs to a much broader base than practical with internal staff Focus company programs on strategic partners, material issues Leverage previous investments in lean manufacturing SME suppliers Faster learning, more successful projects Framework to rationalize competing requirements of customers & develop a more cohesive improvement strategy Facilitates integration of life cycle issues into existing procedures, routines Local sustainability Communities Emphasis on localized decision- making ensures action aligned with significant environmental issues and development priorities Job creation (better jobs) for organizations to support suppliers locally Capable suppliers, vibrant communities, and resilient value chains!

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